BELOW are excerpts of viewpoints from two selected research houses on what investors can expect in the day ahead:
Inter-Pacific Research
The FBM KLCI started the week on a losing note, succumbing to profit taking activities after last week’s recovery.
In the morning session, the key index re-tested the 1,520 level but failed to make a breakthrough with this resulting in the market consolidating in the afternoon session instead.
The lower liners went through another weakness spell which caused market breadth to be decidedly negative with traded volumes continuing to thin to just 3.2 billion shares for the day.
As we have noted, market conditions are relatively toppish after the recent gains with the near-term direction likely to see the key index continuing its drifting mode ahead of the upcoming Chinese New Year break.
There will be few impetuses with the US Federal Reserve poised to keep interest rates elevated for longer.
Bursa Malaysia’s condition could be mixed with the downside bias to also remain as there could be more profit taking activities before the start of the long weekend.
There also remains few domestic leads and this would also leave the market to ponder on its upcoming direction. On the downside, supports are seen at the 1,508-1,510 levels before the psychological 1,500 level comes into play. On the other hand, the hurdles are at the 1,520 and the 1,526 levels respectively.
Malacca Securities Research
The FBM KLCI continued to trade in a sideways manner for the past four trading days as profit taking activities kicked in within the utilities’ heavyweights ahead of the Chinese New Year long weekend break.
Meanwhile, the US stock markets ended on a negative tone with the market pricing in further timeline on the US interest rate cuts after the US Federal reserve chairman Jerome Powell’s speech offsetting the higher-than-expected US ISM Services PMI (Purchasing Managers Index) data.
Meanwhile, the sluggish sentiment in China could further drag the situation on the local front and we believe the profit taking activities could persist over the near term.
On the commodity markets, Brent crude climbed after a four-day drop on the back of rising geopolitical tensions following the US air strike in Iraq and Syria.
The FBM KLCI ended lower. The technical readings on the key index were mixed with the MACD Histogram forming a rounding top formation while the RSI maintains above the 50 level.
The resistance is envisaged around 1,520-1,530 while the support is set at 1,490-1,480. – Feb 6, 2024
